home Equities T.CCO CEO meets with U.S. lawmakers as world events impact uranium industry

T.CCO CEO meets with U.S. lawmakers as world events impact uranium industry

Tim Gitzel in Washington ahead of a ban on Russian uranium coming into force

Tim Gitzel has been spending a lot of time in the United States lately.


The chief executive of Saskatoon-based Cameco was recently in Washington, D.C., where he met with lawmakers to talk about a number of issues.


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Among the topics of discussion for Gitzel and his delegation was a recently passed piece of legislation banning Russian uranium imports. The bill has passed both houses of Congress and is waiting to be signed into law by President Joe Biden.

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Gitzel said the Russian invasion of Ukraine has led to some major changes in the uranium market worldwide. Specifically, he said that before the war, the market was a large one with many different players involved.


“The trade in nuclear fuel was pretty wide open around the world,” he said.


But with sanctions being placed on Russia in retaliation for its invasion of Ukraine, the market is becoming smaller. Gitzel said the legislation in the U.S., which is set to go into effect 90 days after it is signed, has a simple aim.


“The goal is to wean off of Russian nuclear fuel,” he said.


Nuclear investment


Gitzel said that due to the trade of uranium historically being so wide open, the U.S. has not developed a large mining capacity nor much capacity with regards to developing nuclear fuel. Because of this, the U.S. has earmarked more than US$2 billion to rebuild its capacities, and investments will be made in a range of different areas, including uranium enrichment.


“They’re looking to restart the uranium business down there where they can,” he said.


Gitzel added that through Cameco’s ownership of Westinghouse Electric Co. LLC, it will also have a role to play in developing the new facilities that will be needed.

Along with the political developments in the U.S., Gitzel said the uranium market is being affected by the war because it has created supply chain problems for other uranium producers, specifically Kazakhstan, which produces between 40 per cent and 45 per cent of the world’s uranium.


Gitzel said mines in Kazakhstan require large amounts of sulphuric acid to operate. Historically, the country has relied on Russia to provide the chemical, but he said the conflict in Ukraine has created issues.


“They’ve been struggling to get (sulphuric acid) from Russia because of sanctions and Russia’s inability to produce as much as they have,” he said.


The shortage of sulphuric acid will not affect any of Cameco’s major operations since it doesn’t use the chemical as part of its extraction methods.


Cameco mines


Currently, Cameco is producing at two of its facilities in Saskatchewan. For example, Gitzel said at the McArthur River/Key Lake facilities, the company is looking to produce 18 million pounds of uranium this year and is exploring the possibility of ramping up to 25 million pounds in the future. On that front, he said the company needs to look at possible expenditures and make sure there are buyers for the extra production.

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“We will increase our production once customers come to us and buy that production,” he said.


The company’s other facility currently producing in Saskatchewan is its Cigar Lake mine, which is also extracting 18 million pounds per year. Gitzel said Cameco is not looking to increase production at that mine, but is instead planning to expand its life span. The mine was originally set to run until 2030, but he said the company is looking to expand its life until 2036.

Cameco’s third facility in Saskatchewan is its Rabbit Lake mine, which is not currently producing any uranium and is undergoing care and maintenance. Gitzel said the facility can produce between four and five million pounds of uranium per year.


He added that the company does not currently have any plans to restart production at Rabbit Lake, but with demand for uranium likely to increase in the coming years, Cameco is working to ensure it’s in a position to meet potential future demand.


“We’re not taking anything for granted,” Gitzel said.

Source: The Saskatoon Star Phoenix